Paramount Says Its Bid Beats Netflix for Warner Bros Discovery

• Paramount reiterated its bid for Warner Bros Discovery is financially stronger than Netflix's competing offer.
• Rival bids highlight intensifying consolidation and competition within the global media and streaming industry.

The value of the cable offshoot at the heart of Netflix's offer is essentially nothing, according to Paramount Skydance, which has reaffirmed that its $108.4 billion bid for Warner Bros. Discovery (WBD) is better than the rival offer from Netflix.

Netflix and Paramount are vying for Warner Bros.' film and television studios as well as its library of property, which includes DC Comics and Harry Potter.

In contrast to Netflix's $27.75-per-share cash-and-stock bid, which values the acquisition at $82.7 billion and excludes WBD's cable networks, Paramount argues that its all-cash offer of $30 per share for the entire firm offers more stability and a clearer regulatory path. Citing the recent market performance of Comcast spinoff Versant Media as a reference, Paramount claims that the cable assets, including CNN and Discovery, may have little to no equity value.

Additionally, the business contended that if more debt is added to the deal, Netflix's proposal may cut the cash payout to WBD shareholders, which might affect the value of each share. Netflix has reaffirmed that its offer is backed by dedicated bank financing and offers the best value for shareholders.

Also Read: Nielsen, Paramount Reach Multiyear Deal, Ending Dispute

Subject to an extension, Paramount's tender offer is scheduled to expire on January 21. Citing execution risk, significant leverage, and the possible losses to shareholders if the deal fails, WBD has insisted that Paramount's updated bid is still insufficient. The business has also made it clear that ending its contract with Netflix would result in hefty breakup costs.

As legislators and regulators evaluate the effects of additional media industry consolidation, both possible mergers are anticipated to come under regulatory scrutiny in the United States and Europe.